Export loss from capital controls bigger than social security deficit

The losses sustained by exporting companies, and therefore the national economy, as a result of the capital controls and the consequent block on access to foreign banks are even bigger than the much-debated social security system deficit.

The Panhellenic Exporters Association argues that if growth rates of exports (excluding fuel products) recorded up to June 2015 had been maintained, Greece would have collected 2.3 billion euros more than in 2014, with a positive impact on public revenues, social security contributions and the maintenance if not creation of jobs.

It is no coincidence that, combined with the drop in global oil rates, the total value of exports declined in 2015 for a third consecutive year, although the addition of fuel products to the sum points to a 7.8 percent annual rise.

Exporters make no secret of their concerns that any positive impact from the rise in several exporting sectors will vanish due to the closure of the country’s borders owing to the migrant crisis and the farmers’ blockades.

The drop in oil rates along with slowdowns or even recessions in a number of emerging and developing countries affected the mix of the markets for Greek products. An analysis by the exporters’ association showed that exports to fellow European Union members increased by 10.6 percent last year from 2014 (rising 13.5 percent to eurozone peers), while exports to third countries fell by 18.7 percent. This means that the total value of Greek exports to other EU members accounted for 53.3 percent of all exports, against 46.7 percent to third countries.

For instance, Turkey was the biggest market for Greek products in 2014, but last year it dropped to third spot as Greek exports to the neighboring country declined by 47.6 percent year-on-year. Italy was the number one market followed by Germany. Cyprus was fourth and Bulgaria fifth.

Exports to the US posted a huge annual rise of 54.6 percent to add up to some 1.25 billion euros, raising the US from eighth to sixth spot. Britain, Egypt, Lebanon and Saudi Arabia completed the top 10 markets for Greek products last year.